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Research: Maritime satellite sector recovering

April 22, 2022

By Chris Forrester

Research consultancy Euroconsult has released a report which looks at the maritime and cruise line sector. It finds that in 2020 satellite services for merchant shipping grew 4 per cent to $584 million (€540.7m), but Covid saw the market for cruise ship connectivity plummet. The cruise sector is, however, recovering.

In the report titled Prospects for Maritime Satellite Communications, Euroconsult quantifies the heavy impact of the pandemic on satellite services for the maritime market. With in-depth detail on maritime communications market dynamics today and over the next ten years, the research highlights coming opportunities for consolidation and how non-geostationary orbit (NGSO) satellite constellations will change the playing field.

“There was a surprising disparity in the effect of the pandemic on various sectors of the market. Demand for satellite connectivity for cruise ships plummeted with an 80 per cent reduction in active VSATs compared to the previous year. However, the demand for satellite connectivity for the merchant shipping industry remained strong, driven by increased need for crew welfare due to quarantines and longer times at sea because of Covid-19 restrictions. Merchant shipping remains the largest segment of the maritime connectivity market, generating nearly half of the total maritime VSAT service revenue with $584 million in 2020,” states Euroconsult.

“Still feeling the pressure of lengthy restrictions on international travel, ferries and leisure ships have yet to reach their pre-Covid potential. Nonetheless, large cruise vessels, and more than 60 per cent of passenger cruises, managed to resume service last year; a feat that helped lead to an increase in active VSATs by 32 per cent to 31,100 terminals when compared to 2020. MSS terminals on the other hand fell substantially short with increases of less than 1 per cent,” says the research.

“Other sectors discussed in the maritime connectivity report include leisure vessels, oil and gas offshore, and the commercial fishing industry. The former two suffered from the pandemic with lowered revenues however, the market for connectivity services for fishing vessels grew by six percent. Euroconsult forecasts that the fishing industry has further growth potential for mobile satellite services. With the entire value chain severely impacted by the losses in the cruise, leisure, and offshore markets, 2020 was a year of restructuring for many satellite service providers,” the report states.

Overall, last year brought a positive cheer to the maritime market after a two-year uncertainty brought about by the pandemic; data connectivity needs across the maritime market have settle on an accelerating trend favoured by a greater reliance of end-users to data-centric applications, therefore opening new opportunities for the market.

“It has been a tricky couple of years for the Maritime Connectivity market, however we are beginning to see a rise in bandwidth demand, as well as increases in revenue, and terminal manufacturing,” said Vishal Patil, Consultant at Euroconsult and editor of the report. “There is still a long way to go to reach pre-pandemic levels, but with competition getting stronger, the premise of new NGO constellations and with service providers remaining actively invested in the development of value-added services, the outlook for the global maritime market is a positive one.”

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